approach will adjust to further changes in employment
patterns, including an increased number of pensioners
working. Additionally, the co-payment rate should be
lowered for all households with low income—not only
elderly people—to improve inequities in access. Where
to set the line to exempt people from contributing
premiums and making co-payments should be considered
in the context of public assistance reform (panel 4).43
Consolidation within prefectures does not mean that
the national government would abdicate its responsibility.
On the contrary, the government should continue to play
a major part in deciding the services to be covered and
their prices in the fee schedule, in setting national
standards of quality and professional qualifi cations, and
in subsidising prefectures with low average incomes, a
higher proportion of elderly people, and so forth.
However, key decisions about investment in and
restructuring the delivery system would be made by
prefectural governments. This devolution of authority
and fi scal responsibility would be in line with the ongoing
trend in the public sector in Japan.
Global lessons
Japan’s major accomplishment with social health
insurance, from a global perspective, has been its
successful pursuit of the normative goals of expansion of
coverage and containment of costs while improving
equity in the health system over time. Japan off ers several
lessons for other countries.
The fi rst is that attainment of universal coverage on the
one hand and achievement of equity in benefi t packages
and rates of co-payments and contributions on the
other,are diff erent goals and need diff erent long-range
strategies.44 Before universal health coverage was achieved
in 1961, community-based plans adopted the fee schedule
of employee-based plans in 1959. The co-payment rate
became uniform, except for elderly people and children,
only in 2003. However, contribution rates still diff er by
more than three times between the social health
insurance plans. Reform is a continuous process that will
never be completed.
The second is the importance of political driving forces
to move countries forward on the path to universal
coverage. For Japan, the political forces for expansion of
social health insurance coverage were the goals of
achieving a wartime state in the 1930s and 1940s, and a
welfare state in the 1950s to 1970s. For the welfare state,
Japan’s post-war democracy had a crucial role, providing
both popular support and political party competition that
motivated eff orts to decrease inequities in the diff erent
rates of co-payment between social health insurance
plans. Successful egalitarian reforms have been undertaken
in South Korea and Taiwan after the election of
democratic governments.45
The third is the inherent weakness of a social health
insurance system that is fragmented by employment
and residential status as in Japan. Because each plan
will diff er in risk profi le and income level, economic
and political incentives against policy change are
created.46 This diffi culty will be exacerbated if local
governments are allowed to choose their own method
of setting contribution rates. Countries that might
consider adopting Japan’s model of social health
insurance should plan in advance to address its
weaknesses before opposition to structural reform
becomes deeply entrenched.